Market Roundup
- Australia Q4 Export Prices -5.4% Qtr/Qtr
- Australia Q4 Import Prices -0.3% Qtr/Qtr
- UK 2015 New Home Registrations +7%y/y to 156,140; Highest Since 2007 NHBC Says
- UK Q4 New Home Registrations +0.6%y/y at 38,594 - NHBC
- New Zealand Dec Month Trade Deficit Nzd53 Million (Poll Deficit Nzd131mln)
- New Zealand Dec Annual Trade Deficit bln (Poll Deficit bln)
- New Zealand December Month Imports bln (Reuters Poll bln)
- New Zealand December Month Exports bln (Reuters Poll bln)
- RBNZ Says Keeps ODR at 2.5%
- RBNZ Says Further Easing may be needed over Coming Year
- RBNZ Says Further Easing may be needed
- RBNZ Says Inflation Expected to Take Longer to Reach Target Range
- S. Korea V/FinMin: Govt Mulling Over Additional Measures to Boost Consumption
- S. Korea V/FinMin: Measures to Boost Consumption Likely to Be Micro-Economic
- Singapore Q4 Preliminary Unemployment Rate 1.9% vs 2.0% in Q3
- Singapore Total Employment +15,500 in Q4
- Philippine C/Bank Says No Need to Adjust Policy Settings after Better-Than-Exp Q4 GDP
- Philippines Says S/Adj Q4 GDP Climbs 2.0% from Q3 (Reuters Poll: 2.2%)
- Philippines Says Revises Seasonally Adjusted Q3 GDP Growth to 1.4% from 1.1%
Economic Data Ahead
- (0300 ET/0800 GMT) Spain Unemployment Rate
- (0300 ET/0800 GMT) Spain Retail Sales
- (0400 ET/0900 GMT) Italy Wage Inflation
- (0400 ET/0900 GMT) Norway Indus Confidence
- (0400 ET/0900 GMT) Italy Wage Inflation
- (0430 ET/0930 GMT) Great Britain GDP Prelim
- (0500 ET/1000 GMT) Eurozone Selling Price Expec
- (0500 ET/1000 GMT) Eurozone Cons Inflation Expectations
- (0500 ET/1000 GMT) Eurozone Business Climate
- (0500 ET/1000 GMT) Eurozone Economic Sentiment
- (0500 ET/1000 GMT) Eurozone Consumer Confidence Final
- (0500 ET/1000 GMT) Eurozone Services Sentiment
- (0500 ET/1000 GMT) Eurozone Industrial Sentiment
- (0600 ET/1100 GMT) Great Britain CBI Distributive Trades
- (0800 ET/1300 GMT) Germany HICP
Key Events Ahead
- (0500 ET/1000 GMT) Italy 7YFR B 0.337% 15/12/22 . -1
- (0500 ET/1000 GMT) Italy 5Y B 0.650% 01/11/20 . -2
- (0500 ET/1000 GMT) Italy 10Y B 2.000% 01/12/25 . EUR2.5-3.0
FX Beat
USD: The reaction to the Fed in currency markets was much more muted. The greenback managed to gain on the yen, rising as far as 119.06, while against the euro it eased. Against a basket of currencies, the dollar index edged up 0.13 percent to 99.05.
EUR/USD: The euro trades 0.08 percent down at 1.0884, hovering towards session low of 1.0880. On Wednesday, the pair rose to fresh weekly highs at 1.0916 after the Fed kept interest rates unchanged showing concerns over the financial markets turmoil, however, the Fed maintained its stance for gradual rate rises this year. Markets will now focus upon U.S economic releases and German Prelim CPI figures for further cues on the pairs move. Earlier in the session EUR/USD touched sessions high of 1.0907 before dropping down to its current level. Immediate support is seen at 1.0875 (10- DMA), while on the upside, resistance is located at 1.0916 (Previous Session High).
USD/JPY: The pair trades flat at 118.64, after touching sessions high of 118.93. The focus will be now shifted towards Bank of Japan's two day policy meet. The growing uncertainties in global markets in recent weeks and falling inflation expectations due to cheaper oil are increasing expectations that the BOJ will once again step up its easing.Markets will prefer to hold the dollar ahead of U.S economic releases, as the data is expected to provide fresh insights on the U.S. growth prospects. The pair faces resistance at 119.06 (Previous day High), while support is located at 118.93 (Session's Low).
AUD/USD: The Australian dollar is steady against its U.S counterpart as it trades 0.26 percent up at 0.7043 levels. The Fed kept interest rates unchanged as expected and left all options open including a hike at the next meeting in March. Traders continue to follow previous three sessions bullish trends drifting away from multi- years low hit last week. Markets will await next for the forthcoming RBA meet scheduled next month; meanwhile, focus will remain on China, equities and commodity markets with a specific focus on the price of oil. Currently the pair trades at 0.7046 levels, having touched sessions high of 0.7047. Resistance is located at 0.7081 (Previous Session High), while on the downside, support is located at 0.7005 (5- DMA).
NZD/USD: The New Zealand dollar trades at 0.6443 showing a recovery, after it dropped to a low of 0.6416 in its previous session. The kiwi dropped more than half a U.S. cent after the Reserve Bank of New Zealand kept rates on hold at 2.5 percent but delivered an easing bias just two months after suggesting that it would not cut rates further. The RBNZ added further that the recent rise in the kiwi-dollar was not helpful and further depreciation would be appropriate in order to support sustainable growth. The pair currently trades at 0.6445, hovering towards sessions high of 0.6450. Immediate resistance is located at 0.6457 (10-DMA), while support is seen at 0.6411 (Jan 21 Low).
USD/CNY: China's yuan was flat against the dollar on Thursday after the central bank set the midpoint rate at 6.5528 per dollar prior to market open, 0.01 percent firmer than the previous fix 6.5533. The spot market opened at 6.5780 per dollar and was trading at 6.5777 at midday, almost unchanged from the previous close. Offshore yuan was trading 0.52 percent softer than the onshore spot rate at 6.6121 per dollar. The change in the index came after the Fed suggested its concern about global events had diminished chances of a rate hike in March.
Equities Recap
Asian shares pushed back into the black on Thursday as investors dipped their toes back into equities and demand for safe haven assets such as the yen and sovereign bonds faded.
MSCI's broadest index of Asia-Pacific shares outside Japan swung 0.4 percent firmer in very slow trade, while Taiwan stocks edged up 0.7 pct at 7,905.10 points.
Australia's S&P/ASX 200 Index edged up 0.80 Pct At 4,986.00 Points, while Nikkei dropped 0.71 pct at 17,041.45, with Seoul closed up at 0.47 pct.
Commodities Recap
Gold edged down from 12-week highs on Thursday, as the less dovish tone of the Fed's statement weighed on gold. Spot gold was down 0.5 percent at $1,119.69 an ounce by 0240 GMT, while U.S. gold for February delivery gained 0.4 percent to $1,120 per ounce. Spot silver slipped 0.2 percent to $14.46, while platinum was down 0.7 percent at $873.93, with Palladium steady at $496.90.
U.S. crude futures dropped more than 1 percent in Asian trading on Thursday, eroding gains of nearly 3 percent made in the previous session after Russia held out the possibility of cooperating with OPEC to control global oversupply. Brent crude had eased 35 cents to $32.75 a barrel by 0315 GMT, after ending up 4.1 percent at $33.10. U.S. crude declined 36 cents to $31.94 a barrel. It settled the previous session up 85 cents at $32.30, a 2.7-percent gain.
Treasuries Recap
U.S. 10-Year Treasuries yield stood at 2.008 percent versus previous close of 2.003 percent.
Australian government bond futures were lower, with the 3-year bond contract off two ticks at 98.080. The 10-year contract eased one tick to 97.3150, while the 20-year contract added one tick to 96.8300.
New Zealand government bonds were mixed, with yields a touch lower.
Canadian government bond prices were higher across the maturity curve, with the benchmark 10-year gaining 18 Canadian cents to yield 1.245 percent, while the 2-year was up 2 Canadian cents to yield 0.421 percent.
